Scandinavian carrier SAS said its fourth quarter was the strongest since before the pandemic, driven by a pick-up in corporate travel and healthy leisure demand.
“We remain cautious due to prevailing uncertainties, but see that underlying demand is healthy once restrictions are lifted, both for business and leisure travel,” the carrier said in a results statement on November 30, 2021. “(The) short-term effect of recent developments needs yet to be fully analyzed, however we remain optimistic for the peak periods ahead of us.”
The airline made the comments as it reported a pretax loss of SEK 6.5 billion ($0.7 billion) for the year to October 31, 2021.
SAS said its fourth quarter had been the strongest since the final quarter of 2019 and that it achieved positive cash flow of SEK 1 billion ($110 million). That marked the second quarter in a row of positive cash flow.
In the fourth quarter, passenger numbers rose 88% year on year to 3.6 million, while it achieved a pretax loss of SEK 0.9 billion ($99 million), a 71% improvement.
SAS chief executive Anko van der Werff said the airline had to continue transformation efforts to adapt to a changing competitive landscape.
“During the pandemic, we see that demand for travel has changed and SAS expects a greater number of leisure travelers and even more intense competition in the future,” van der Werff said.
SAS is starting operation of new unit SAS Connect out of Copenhagen in early 2022 and said it was looking at options to expand the unit, opening bases in Stockholm and Oslo in 2022. Unions have criticized the new unit as a way to bypass existing collective agreements.
“Market dynamics have changed substantially during the pandemic and affect the entire airline industry. This requires SAS to take the next steps in the development of our operating model to ensure SAS is cost efficient and competitive,” the airline commented in the results statement.
SAS also added it was also looking at “fleet options to handle thinner flowers of passengers in our network”.
During the fourth quarter SAS signed pre-delivery payment financing of approximately $100 million to cover the financing of 10 A320neo aircraft with deliveries into Q2 2023.
It has also signed a collaboration with energy companies Vattenfall, Shell and Lanzatech to investigate production of synthetic sustainable aviation fuel (SAF). SAS said when production is fully up and running, it could provide up to 25% of its SAF requirement in the 2030s.